Is B Corp Still the PR Powerhouse It Used to Be?

Once a badge of ethical honour, B Corp certification was the ultimate PR move for brands seeking to demonstrate they stood for more than profit. It signaled a company’s commitment to people, planet, and purpose – an easy win for reputation management and customer loyalty. But in a world increasingly flooded with ESG claims, investor-focused ratings, and corporate greenwashing scandals, it begs the question: is B Corp still the trusted marker it once was?

Understanding ESG

To understand where B Corp fits in, we first need to unpack ESG ratings. ESG stands for Environmental, Social, and Governance. At surface level, it’s a scoring system designed to help investors evaluate how well a company manages its risks and opportunities related to sustainability. Here’s a breakdown:

Environmental (E): Carbon emissions, energy use, waste, and impact on natural resources.
Social (S): Labour practices, diversity, community involvement, and human rights.
Governance (G): Board diversity, transparency, ethics, and executive accountability.

Unlike credit ratings, which are heavily regulated and standardised, ESG scores are largely unregulated and vary depending on the rating agency, the big ones being MSCI, Sustainalytics and S&P Global. These agencies often base scores on subjective self-reported data and publicly available disclosures, rather than independent audits.

So, who are these scores for?

Mainly investors and corporate buyers looking to mitigate financial risks. While ESG appears to align profit with purpose, it often prioritises financial sustainability over actual environmental or ethical impact.

The key question these ratings try to answer isn’t “is this company sustainable?” but rather, “is this company’s profit model sustainable in a changing world?”

And that’s a crucial distinction.

McDonalds in April 2021

A 2022 Bloomberg investigation highlighted the shaky foundations of ESG scoring, using MSCI’s rating methodology as a case study. They found that many companies received rating upgrades while just sitting still on their ESG activities. Those upgrades were given only because MSCI decided to change how it calculates its ESG scores that year.

Take McDonalds for example. The fast-food giant, whose emissions rival those of Portugal, was upgraded by MSCI from BB to BBB in 2021. But McDonalds hadn’t cut its emissions? Instead, it received an upgrade because MSCI stopped counting carbon emissions as a meaningful financial risk.

Its upgrade was actually attributed to the fact that McDonalds rolled out recycling bins in select locations across France and the UK. However, it just so happened that both France and the UK were to release regulatory mandates on recycling bins that year. This means McDonalds had not ‘proactively’ installed recycling bins to better its impact on the planet, but only did so to avoid potential future financial penalties…the bare minimum.

This speaks to a broader issue: ESG scores protect shareholder value, not necessarily the planet.

Where B Corp Comes In

While ESG is often about investor risk management, B Corp certification is about systemic change. While it is scored, it shows that a business has a commitment to being a force for good.

Certified by the nonprofit organisation B Lab, B Corps undergo a rigorous B Impact Assessment (BIA) every three years. The BIA measures companies across five categories:

Governance – mission, ethics, and transparency
Workers – compensation, benefits, and culture
Community – supplier ethics, diversity, civic engagement
Environment – emissions, energy use, sustainability practices
Customers – impact of business models on end users

Unlike ESG ratings, B Corp certification requires proactive progress. It’s about embedding purpose into a company’s legal structure and operations. You can’t be passive and just sit still. Well known B Corps include the likes of TOMS, that donates a pair of shoes to a child in need for every pair of new shoes purchased, and Patagonia, best known for its ‘Don’t Buy This Jacket’ campaign that promotes ethical consumption.

But Is B Corp Losing Its Shine?

However, not all that glitters is gold. In 2022, the credibility of B Corp took a hit.

When Nestlé’s Nespresso earned its B Corp certification, industry watchdogs balked. Dozens of existing B Corps, led by the Fair World Project, signed an open letter denouncing the move, citing Nespresso’s “abysmal track record on human rights” and its “extractive business model.” Critics argued that the certification was being diluted by allowing large, controversial corporations to wear the B Corp badge.

Later that year, BrewDog, a British brewery, actually lost its certification after employees described a toxic workplace culture in an open letter. Their account of bullying and “a culture of fear” contradicted the company’s supposed B Corp values.

B Corp has since faced a media storm of greenwashing allegations, with brands even dropping their B Corp status:

Is B Corp Just a Buzzword Now?

These controversies highlight a crucial tension: if B Corp is to maintain its integrity, it must resist the temptation to grow at the expense of its values. Certification must remain at a high bar.

To its credit, B Lab has responded by tightening its standards and seeking greater global alignment. But as with any trust-based system, credibility, once shaken, takes time to rebuild.

Here’s how the new standards aim to do just that:

To maintain certification, companies must re-certify every three years, redoing the B Impact Assessment and submitting updated documentation for review.

Now, B Lab is transitioning away from a points-based system toward one based on minimum performance requirements across now seven key “impact topics”:

Purpose and stakeholder governance
Climate action
Human rights
Fair work
Environmental stewardship and circularity
Justice, equity, diversity, and inclusion (JEDI)
Government affairs and collective action

Judy Rodrigues, B Lab Global’s Director of Standards, explained that the new framework is the product of a four-year process, including two rounds of public consultation and the review of over 26,000 feedback submissions from companies, the public, and experts.

The new version of the standards also introduces tiered requirements based on company size too. For example, those with 1,000–9,999 employees or $350M–$1.5B in revenue will be held to even more rigorous criteria.

Be Sustainable in Your Own Right

B Corp certification is undeniably a strong signal of a company’s ethical and environmental commitment, but it comes with a cost. Certification starts at around £1,000, and that can be prohibitively expensive for small businesses, especially those already investing in sustainable operations.

In a perfect world, businesses wouldn’t need a badge of honour to motivate responsible practices or turn consumers’ heads. Sustainability would simply be the norm. But we don’t live in that world. Certifications like B Corp are still important in serving as important validation of sustainable practices in a world where greenwashing runs rampant.

Still, some brands prove that you don’t need a certification to do the right thing.

Take Tony’s Chocolonely, for example. While it’s not a B Corp, Tony’s done its own thing in creating a sustainable and ethical chocolate industry. Their approach focuses on:

Fair prices for cocoa farmers
Deforestation-free sourcing
Reducing carbon emissions across their supply chain
And most importantly, ending modern slavery and child labor in cocoa production

In fact, their headlining mission is to make 100% slave-free the norm in chocolate.

And rather than flaunting a certification logo on the front of its packaging, Tony’s does something even smarter: it uses the inside of its wrappers to tell the story of its sustainability efforts.

Tony’s shows that purpose-led business doesn’t have to be performative. You can be sustainable in your own way.

Personal Thoughts

There’s been a rise, a fall, and now (potentially) a rise again of the B Corp certification. It’s great to see that B Lab has responded to the B Corp scrutiny and adjusted its measures transparently. I think this bodes well for B Corp to redeem its status as a meaningful certification.

As a result, it will be interesting to see which companies will step up to meet the new bar, which ones will quietly step away and which brands will set their very own industry standards.